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consolidation in european bakery suppliers market forecast
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recent acquisition activity in the bakery ingredients supply industry involving dutch firm sonneveld being bought out by orkla food ingredients may signal a flurry of similar takeovers and could mean price benefits for bakers, claims a market analyst. maya donceva, senior industry analyst for food ingredients at rabobank international, holds that as financing has become easier to secure, there could be a rake of takeovers of the small and medium enterprise (sme) speciality players in the sector over the next 12 months. she told bakeryandsnacks.com that as management teams in companies involved in the bakery ingredients sector start to focus on setting up structures that make their businesses more resilient to volatility, sme bakery speciality suppliers in belgium, germany and central and eastern european countries, in particular, could become acquisition targets. “a lot of these smaller players such as puratos and zeelandia would represent an attractive takeover proposition for the larger supplier companies in that they have global production and r&d facilities as well as a wide distribution network and an interesting product portfolio,” said donceva. however, she said that currently there is no indication of these smes being open or available to any acqusition offers. donceva maintains that consolidation for firms like family owned companies such as sonneveld can offer opportunities to tap into faster growing niches and markets, to widen portfolios to spread risk, to team up with stronger partners, and to reduce production costs. and, according to the market analyst, bakery manufacturers can gain from suppliers having these bigger economies of scale from acquisition due to the fact that the synergy savings will likely lead to lower costs of ingredients and will also result in more investment in innovation. and donceva said that bakery ingredient manufacturers generally rode out the peak of the recession well despite a decline in volumes and the reduction in overall margins. she remains somewhat cautious though about short term recovery in the bakery sector, a statement that echoes the comments from csm chief executive gerard hoetmer last week. “our bakery supplies activities are still facing a challenging market climate, although we have seen the declining volume trend levelling out,” he reported as first quarter csm results for the year showed a decline in volumes by 1.2 per cent on q1 2009. hoetmer said that there were no immediate signs that markets are definitely picking up but that the company remained focused “on maintaining our margins and on managing our cost base and continue our efforts to stimulate growth through innovation.” and csm, which supplies ingredients to semi-finished and frozen, almost-ready and ready-made products to artisan and industrial bakeries, stated that due to the continuing volatile economic climate in the main markets that it operates in, it still lacks the visibility to clearly forecast the development of sales volume over the next three quarters.
Source :foodanddrinkeurope.com
Date :
4
May
2010
Category :
restaurants and Food industrie
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nutraceutical clinical laboratories international incorporated (nclii) has begun selling its nupreserv product to one of the leading us bakery groups. the natural ingredient is designed to help maintain the freshness of bakery products and extend their shelf-life. nclii said that since the freshness of baked goods was vitally important, bakeries usually maintain non-disclosure agreements with companies that assist them in preserving the freshness of their products, and that as a result it was unable to disclose the name of the bakery.
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bakery products have underlined the overall resilience of uk-based processor and retailer associated british foods (abf) despite what the company calls ‘steadily worsening economic conditions’ during the 2008 fiscal year. abf said that for the twelve-month period ending 13 september 2008, revenues were up by 21 per cent to £8.2bn, even with surging input costs, as the company drove up the pricing of key brands such as its kingsmill and ryvita products.
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new high-margin opportunities for bakers continue to open up in russia as the economy flourishes, fuelling consumer purchasing power and raising demand for western-style breads and confections. according to the world bank’s june 2007 report, the strengthening of the ruble and stable growth in personal incomes are expected to help expand the retail market’s size to €510bn by 2011.
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the developer of two new enzymes claims the products can ensure a better baking performance from flour to compensate for poor wheat quality. cognis says that its latest nutrilife me 01 and lamemul mm 01 products can considerably improve flour quality, while avoiding the expensive and technically complex process of blending wheat with good gluten properties. company spokesperson andreas funke said that the enzymes' launch allowed processors a competitive alternative in the market for premium-quality flour.
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